Property Assessment & Taxes

1. Property Tax

Property tax is a local tax

In New York State, the property tax is a local tax, raised and spent locally to finance local governments and public schools. While the State itself does not collect or receive any direct benefit from the property tax, this tax is still of major importance as the largest single revenue source for the support of municipal and school district services.

Counties, cities, towns, villages, school districts, and special districts use property taxes to fund:

• schools
• police and fire protection
• road maintenance
• many other municipal services

Property taxes are based on the value of real property

The property tax is an ad valorem tax, meaning that it is based on the value of real property. Real property (commonly known as “real estate”) is land and any permanent structures on it.

Without accounting for exemptions, properties of equal value in the same community should pay the same amount in property taxes. The owners of more valuable properties should pay more in taxes than the owner of less valuable properties.

Source: https://www.tax.ny.gov/pit/property/learn/proptax.htm

2. Property Assessment

Assessments and market value

A property’s assessment is based on its market value. Market value is how much a property would sell for under normal conditions.

Assessments are determined by the assessor, a local official who estimates the value of all real property in a community. Most assessors work for a city or town, though some are employed by a county or village.

All properties in your municipality (except in New York City and Nassau County) are required to be assessed at a uniform percentage of market value each year. In other words, all taxable properties in your city or town must be assessed at market value or at the same percentage of market value.

• For example, if the market value of your home is $200,000, and assessments in your community are at 30 percent of market value, your assessment should be $60,000.

In communities assessing property at 100 percent of market value, your assessment should equal roughly the price for which you could sell your property. In communities assessing at a percentage of market value, the estimated market value of each property is listed on the assessment roll.

Source: https://www.tax.ny.gov/pit/property/learn/asmts.htm

3. Contesting Your Assessment

Is your assessment fair?

Before pursuing formal review of your assessment, you should first determine if you are assessed fairly.

If your assessment or the estimated market value for your property is higher than the price for which you can sell your home, you should discuss it with your assessor.

If the assessor does not reduce your assessment, you can contest your assessment.

If on or prior to Grievance Day, you and the assessor enter into a stipulation to a reduced assessment of the value of your property, you may not ask the board of assessment review for a further reduction in your assessment, nor will you be allowed to seek a lower assessment through judicial review. You will be required to complete and sign Part Six of RP-524 tax grievance form.

What are the grounds to challenge a tax assessment?

A party aggrieved by an assessment in New York may contest a tax assessment, on the following four grounds:

1. Excessive assessment. In assessment districts that assess at full value (100% LOA), a property may be assessed in excess of its fair market value. The assessment may also be excessive because of the denial of all or a portion of a partial exemption.
2. Unequal assessment.  Inequality exists when property is assessed at a higher percentage of its fair market value compared with all other property (or properties in the same class) on the assessment roll.  This is the most common ground for challenging an assessment.
3. Misclassified assessment.  This can occur when the property is improperly classified for its actual use. For example, retail property is classified as multi-family residential.
4. Unlawful assessment. If the property is either located outside of the boundaries of an assessment unit or is, for example, exempt from taxes because of a charitable exemption, the assessment may be unlawful.

Grievance procedures

There are two levels of formal review, administrative and judicial. In order to pursue judicial review you must first go through administrative review. In other words, if you did not submit an RP-524 form before the grievance day deadline, you cannot pursue judicial review of your assessment.

Administrative review

This is the grievance process conducted at the municipal level. In the Town of Hancock, this entails filing the tax grievance paperwork (Form RP-524) with the Town Clerk, and presenting your case to the local board of assessment review (BAR) on grievance day, which is conventionally the fourth Tuesday in May.

Judicial review

If you are dissatisfied with the decision of the BAR, you may seek judicial review of your assessment via:

1. Small Claims Assessment Review (SCAR)
   • This option is only available to:
     • Property owners who live in their one, two or three family dwellings that are used exclusively for residential purposes, or
     • Owners of vacant land that is not of sufficient size to contain a one, two or three family dwelling
   • Requires $30 filing fee
   • Information regarding SCAR is available from the New York State Unified Court System
2. Tax certiorari proceeding
   • Commenced in New York State Supreme Court pursuant to Article 7 of the Real Property Tax Law
   • It is highly recommend that you contact a private attorney to represent you in tax certiorari proceedings

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